Top Digital Banks for Investing

As inflation continues eating away at people's savings and reduces their purchasing power, investing remains an intimidating concept for many. This is hardly surprising - especially in such a turbulent point in time, complete with frequent interest rate hikes, massive lay-offs and unstable geopolitical realities. However, latest developments in financial technology and an increased competition for retail investors from companies all over the world made investing way more beginner-friendly.

The trend has led to the emergence of many new digital investment apps, with mobile-first banks following suit. It is now easier than ever for anyone to own a tiny part of Apple or Tesla, which used to be a complicated process with a variety of hidden fees and costly middlemen. Nowadays, you're only one app download away from embarking on a journey towards long-term financial well-being. But what's the best way to approach this? Do you need to find a perfect broker and separate your day-to-day expenses from your savings? Or will it be enough to just find a "one stop shop" bank you could invest with?

In this guide, we define the key factors to consider when choosing the way to invest that suits your needs and provide our experts' recommendations on top online bank accounts that have top-notch security and provide customers with convenient and efficient ways to multiply their wealth.

Additionally, consider evaluating financial institutions' commitment to sustainable banking practices and ethical investments to be a massive factor - in our article on sustainability and ethics in investments and banking we briefly described the issue and suggested ways you can have an impact while multiplying your wealth. And if you want to finally take a step and start investing in cryptocurrencies, we invite you to explore our "Beginner's Guide to Crypto & Blockchain", where our experts explain all key concepts in a very concise way.

What matters the most in an investment product?

Leaving all the savings in a bank account would eventually seem like a waste given the barely positive returns and the enormous opportunity costs presented by the world of investments. Any investment bears certain risks, so make sure to take your time and think about the following fundamentals:

1. Define What You're Looking For: Consider the following questions: Does your bank provide an access to another service simply taking a fee and complicating things? Do you want to trade specific assets yourself or would you rather trust a professional to manage your funds? What level of liquidity would you prefer (i.e. how flexible about taking money out and putting them in should your ideal investment solution be)? What is your risk appetite and preferred time horizon would be?
2. Reliability & Security: just like anything else that’s booming, scammers are also working hard to cash in on this trend. Make sure to do your due diligence and research if the investment provider is a reputable financial institution and see whether they are fully licensed by relevant authorities. A good idea is to read reviews from well-known comparison sites such as Trustpilot. Always do your research before taking any further steps!
3. Assets You're After: Do you want to create a stock portfolio, invest in precious metals or are you more interested in cryptocurrencies? While there are some "all-in-one" platforms like BUX or Bitpanda that allow you to trade everything, you might want to choose a specialized broker if you only want a certain asset type (for example, DEGIRO for stocks & ETFs or Kraken for digital assets).
4. Fees: Hidden or non-transparent fees are a significant factor that puts people off from becoming efficient with their funds. You could be charged for putting in an order, keeping deposits at the provider, or simply withdrawing your funds. Digital banks and new investment apps are well aware of this pain point and have all adopted various ways to consolidate different fees and making them more prominent in the app before your press "Confirm".

There is no universal answer to what the best way to invest is, and we're not after giving you financial advice. After all, only you know what your goals and preferences are! However, our team of fintech experts has done their due diligence and we'd like to present three banking solutions that stood out.